The issue has opened for subscription with its initial public offering (IPO) of 64,00,000 equity shares of face value Rs 10 each. The issue will close on May 30, 2008. The price is fixed at Rs 40 per equity share.
Hem's report on Bafna Pharmaceutical's IPO:
Company presently has obtained 336 product licenses and has 65 products registered in various countries such as Srilanka, Ukraine, Ghana and Lao. The company’s dispatches to these countries have essentially to be only those products which are registered in the respective countries. Company has been WHO-GMP certified since 1995. The manufacturing facility at Madhavaram is ISO 9001:2000 certified. The new facility at Grantlyon is as per EU GMP guidelines and is in the process of obtaining MHRA and USFDA approvals. Company has been awarded the Best Supplier Award from State Pharmaceutical Co-operation of Sri Lanka in 2005. The Company presently manufactures 126 formulations under various therapeutic segments such as - anti-infective, cholesterol lowering agents, analgesic and antipyretic, antihelmintics, appetite stimulants, cough and cold preparations, antiulcerants anti diabetic and vitamins etc. The manufacturing facilities of the company are multi-adaptable i.e. the facilities can produce multiple products using a combination of process.
Valuation:
The company at price of Rs 40 per share will have the p/e multiple of 36.57 at post issue eps of 1.09 (Basis PAT annualized for 9 months ending Dec’07). Looking at the peers, the valuation of the company looks stretched at present level. Hence we recommend the investor to ignore the issue.